Or, as Larry Kudlow put it, “When the government spending share of GDP declines, so does the true tax burden on the economy. As a result, more resources are left in the free-market private sector, which will promote real growth.”

Ask yourself why GDP would shrink if the burden of government is reduced slightly. Why would Gross Domestic Product be affected by a threat of a reduction in the parasitical sector–the sector (government) that doesn’t produce wealth, but only consumes it?

Could this paradox be a result of the way in which GDP numbers are crunched?

Indeed.

Gross domestic product (GDP) gauges economic activity based on spending, or “consumption,” which is not what creates wealth. Production creates wealth. (Gross domestic income (GDI) is a lesser-known calculation used by the Federal Reserve to gauge economic activity based on income.)

Official GDP numbers also chart—and include—the growth of government debt. As Vox Day has explained, “GDP counts spending but doesn’t subtract debt, so it’s like saying that you’re rich because you maxed out your platinum Mastercard. Until the debt is paid back, you can’t properly count it as economic growth. And almost all of the GDP growth over the last 20 years has been nothing but debt growth.”

When our economic definitional building blocks are thus perverted, it becomes easy to peddle the GDP hoax. And that hoax is that a reduction in state spending and debt is also a reduction in economic growth, and that reducing debt must be avoided at all costs.